Grassley: taxing bonuses may be best option

Republican Senator Chuck Grassley says the "best leverage" congress may have to recoup Wall Street bonuses at businesses that received taxpayer bailout money may be to tax the bonuses.

The U.S. House has passed bill a that would impose a 90 percent federal tax on bonuses paid to executives at AIG, a company which received federal bailout money. "I have to do what I can do and it looks to me like congress’s best leverage is taxes," Grassley said Sunday morning during an appearance on the CBS News program, "Face the Nation."

Grassley’s first comments on the program recast remarks he made last week that drew national attention for his references to suicide and — to clean up the reference a bit — the breast of the American taxpayers. According to Grassley, Iowans are "outraged" by what’s happened at AIG and other Wall Street companies.

"They just don’t understand how people that make $20 million a year can drive a corporation into the ground, go suck off the taxpayers for bailouts and then give out millions (of) dollars in bonuses. We believe ought to be compensated right, but there’s a whole different ethic when you have the taxpayers bail you out," Grassley said. "There ought to be respect for middle class taxpayers. There ought to be respect for the face that you made a mistake. We ought to hear some apology. We ought to hear remose. We ought to hear contrition. I haven’t heard any of that."

Grassley questioned the business decisions made by some of the firms which have received bailout bucks from the federal government. "We put billions (of) dollars into Wall Street and they loaned money — $8 billion — to Dubai," Grassley said. "You know, the peole of the Midwest just don’t understand how you can run a business that way and expect the taxpayers to keep you going."

Grassley, who appeared on the show via satellite from Cedar Falls, expressed doubt the House bill that would tax AIG bonuses will come up for a vote in the U.S. Senate anytime soon, as senators may be presented an alternative plan to deal with the bonuses.